Greek official: Ability to pay new taxes exhausted

ATHENS, Greece -- Greece has "exhausted" its ability to pay more taxes to cover budget gaps, the deputy prime minister declared Wednesday, saying he himself can't pay a new emergency tax without selling property.

Theodoros Pangalos spoke as the debt-shackled nation faced fresh strikes and braced for another inspection by international creditors, starting today, to decide whether to continue the vital bailout loan payouts.

Parliament approved a new emergency property tax Tuesday to be added to electricity bills later this year, as Greece remains under strong international pressure to abide by its painful deficit-cutting targets. Greece will go bankrupt by mid-October if it does not get an expected $11 billion loan.

"I believe that the tax limits of Greek society have been exhausted. I would say they have been exhausted for some time," Pangalos told private Mega television.

Greeks have been outraged by the announcement of new austerity measures, including pension cuts and the new property tax, coming after more than a year of spending cuts and tax hikes.

In Athens, another 24-hour public transport strike Wednesday left commuters struggling to reach work as unions lashed out against the austerity measures that the Socialist government hopes will get it access to crucial loans.

The strike left Athens without buses, subway services, taxis and trams. Customs and tax office workers were also on strike, while about 350 retirees demonstrated outside the Finance Ministry against the latest pension cuts and tax increases.

The heads of Greece's international debt inspectors are due back in Athens today to complete a review of the government's cost-cutting program.

International creditors have urged Greece's Socialist government to make deeper cuts in public payroll costs instead of repeatedly raising taxes.

On Wednesday, more than 1,000 protesters from a Communist-backed labor union demonstrated outside the Finance Ministry, urging Greeks not to pay emergency property tax bills being sent to households this fall. Protesters burned copies of the tax notices during the peaceful rally.

"We're against workers paying even one euro for this situation," Iota Tavoulari from the union of pharmaceutical workers told The Associated Press.

"We know very well that none of the money from all the (loan) installments, received after really slaughtering the rights of workers, is going to support the workers. Not one euro to salaries, not one euro to pensions, and not one euro to social welfare," she said. "It is being paid to those who caused this crisis."